As a small business, you have a lot to worry about already. From managing cash flow to local outreach, you’ve always got something on your plate. Small business health insurance is just another confusing part of running your own small business, and it isn’t always clear the best way to make a decision.
The majority of American rely on their employers to provide the right health coverage. Navigating the current health insurance system is complicated, especially if you don’t have that many employees to consider. If you choose the wrong insurance for your small business, you could leave employees in a position where they’re unable to get the coverage they need. On the other hand, the highest ranked places to work are all businesses that value having good coverage for their employees.
How can you confidently choose the best small business health insurance for you and your employees? Keep reading for a clear guide to finding the right plan.
For businesses with less 50 full-time employees, there is no law about needing to offer health insurance to your employees. For small organizations with only a handful of employees, there might be confusion about why you should even bother with health insurance in the first place.
No matter if you have five employees or 500 employees, you should offer health insurance. Independent plans for those who don’t have employer coverage do not offer affordable, customizable plans. Small business health insurance can provide quality coverage at a reduced cost.
Another benefit of offering health insurance is the tax credit. If you have fewer than 25 full-time working employees, pay at least 50% of the premium cost of the coverage, or you pay salaries of under $50,000 per employee on average, you qualify for tax credits. While these credits vary depending on your situation, you can receive up to 50% off your contribution towards premiums which makes offering health insurance much more affordable.
Finally, you should offer small business health insurance because it takes care of your employees. People are motivated to work for companies that value them and care about their well-being outside of work. As the market continues to change, people are looking to work for places that offer a variety of benefits like health insurance coverage. Healthy employees are more productive than unhealthy employees.
This is the tricky part. While it’s easy to understand why you should offer insurance to your employees, finding plans that work for your business takes time and effort. You have the option to work with an insurance broker or on your own.
While working with a broker is a great option if you’re too busy to devote time and attention to searching on your own, you can research a wide variety of health insurance firms online. Avoid feeling overwhelmed by sticking to insurance plans that make sense for your business size and employee demographics.
It’s worth asking your current employees what coverage they think suits them best, and if they’ll need more than traditional medical coverage like dental or vision. While it’s not legal to ask your employees directly for their health history, you can distribute a survey or poll to see which benefits they value the most.
When looking for the best plans, you’ll need to decide between a wide range of coverage or low monthly premiums. While it’s impossible to make everyone happy, you can do your best to find a good fit for everyone. Your employees might feel comfortable paying out-of-pocket for health expenses which might suggest you should choose less coverage with lower monthly premiums. However, if you or your employees need more coverage, the extra cost is likely worth it.
Different Plan Types:
- HMO: Know as a Health Management Organization, these plans are limiting but more affordable. They require in-network doctors to get coverage.
- PPO: This stands for Preferred Provider Organization which gives a lot of flexibility with provider networks, but leads to higher costs for routine assistance.
- POS: A Point of Service plan is a combination of HMOs and PPOs. You’ll need a referral to see a specialist, but you will pay less for out-of-network visits.
When you’ve decided on the plan that’s right for you, you’ll need to apply. Like any part of running a business, this is a process that takes time and preparation. You’ll need to gather necessary documents like your business information and the list of employees you will be covering.
Depending on the plan you might also need to include your payroll records or an Employee Census that highlights employee demographics. An Employee Census provides information such as names of those being covered, their ages, zip codes, and any dependents.
Once you’ve finished the application process, congrats! You’re on your way to promoting health, wellness, and success with your small business. Providing coverage is a significant way to show your employees you’re serious about their wellbeing. While shopping for small business health insurance isn’t always easy, it pays off for your company.